HDFC posts ₹3,691 crore PAT for Q3 FY23 on healthy AUM growth

Housing Development Finance Corporation posted a net profit of ₹3,691 crore for Q3 FY23, up 13.2 per cent year-on-year (y-o-y), led by healthy growth in Assets under management (AUM) on the back of individual loans.

HDFC said inherent demand for home loans continues to be good, adding that during the nine months ended December, the company saw growth in both, the mid-income segment as well as high-end properties.

AUM of HDFC rose 13 per cent to ₹7.0-lakh crore as at the end of December, of which individual loans comprised 82 per cent, up 18 per cent on year, it said in a release.

Transmission lag

“During the nine-months ended December 31, 2022, though lending rates have increased, there has been a transmission lag between the interest rate increase in borrowing costs and asset repricing,” the company said, adding that this has had a short-term impact on interest income. Net Interest Income (NII) for the quarter grew 13 per cent to ₹4,840 crore.

In the reporting quarter, HDFC assigned loans of ₹8,892 crore to HDFC Bank, taking the total loans sold in the last 12 months to ₹35,937 crore.

The collection efficiency for individual loans was 99 per cent so far for the current financial year. Credit costs for the period fell to 28 basis points (bps) from 35 bps a year ago.

Unaccounted gains on listed investments in subsidiary and associate companies amounted to ₹2.6- lakh crore as of December 31.

Revised norms

“Based on the revised norms by the Reserve Bank of India (November 12, 2021 notification), as at December 31, 2022, there has been a significant improvement in nonperforming loans (NPLs),” it said.

Gross non- performing assets (NPA) ratio improved to 1.49 per cent as of December 31 from 2.32 per cent a year ago. Of this, gross NPLs for the individual portfolio were at 0.86 per cent and for non-individual loans at 3.89 per cent.

Capital adequacy ratio of HDFC was at 23.7 per cent as of December 31, of which tier I capital was 23.2 per cent.